Regulation and Management in the Global Economy Case Study

Regulation and Management in the Global Economy - Case Study Example 10 defines company provisions for leadership structure of the board of directors whereas sub-section A.2 has clearly explained division of responsibilities between head of the board and the executive officer. The code states that the office of chairman and chief executive officer should not be held by the same individual and this detachment of roles must be set out in writing. In contrast to the principles of UK corporate governance code, 2010; Imola plc is practically in violation of these principles. The role of the chairman has only been restrained at leading the board for effectiveness in setting agenda for board meetings and in constructing relations between executive and non-executive directors. Despite the fact that code constrains chief executive officer to be the chairman of the board but in exceptional cases major shareholders must be consulted in this endeavor which in case of Imola plc can only be justified as an exception only if the major shareholders have also been con sulted in advance to the appointment. Provided the company performance and restructuring, the decision for appointing same person as chairman and chief executive officers seems clear violation of duality clause of the corporate governance code. Section 2 of the corporate governance code, 2010 stipulates some principle regarding the effectiveness of the board, of which composition of the board has been defined in sub-section B.1 of the code, 2010. Sub-section B.1 states that the board of directors must be composed of individuals from diverse areas of expertise so that balance of skills and experience could be maintained efficiently and should be based upon sufficient member size for better management, monitoring and evaluation. Imola plc has successfully implemented this principle by maintaining sufficient size board and directors from diversified backgrounds (Clarke & Branson, 2012). What Imola plc has failed to implement is the balance between executive and non-executive board